SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
___________________
FORM 10-K/A
FOR ANNUAL AND TRANSITION REPORTS PURSUANT TO
SECTIONS 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 or 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED]
For the fiscal year ended December 31, 1995
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
For the transition period from to
Commission file number 1-6016
THE ALLEN GROUP INC.
(Exact name of registrant as specified in its charter)
Delaware 38-0290950
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
25101 Chagrin Boulevard, Beachwood, Ohio 44122
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, (216) 765-5818
including area code
Pursuant to the requirements of the Securities Act of 1934,
the registrant has duly caused this amendment to be signed on its
behalf by the undersigned thereunto duly authorized.
THE ALLEN GROUP INC.
(Registrant)
Dated: April 29, 1996 By: /s/ McDara P. Folan, III
McDara P. Folan, III
Vice President, Secretary
and General Counsel
Page 1 of 48 pages
Exhibit Index is located on page 6
ITEM 14 - EXHIBITS, FINANCIAL STATEMENT SCHEDULES,
AND REPORTS ON FORM 8-K
(a)(1) Financial Statements of the Registrant
The Consolidated Financial Statements of the Registrant listed
below, together with the Report of Independent Accountants,
dated February 16, 1996, are incorporated herein by reference to
pages 15 to 30 of the Registrant's 1995 Annual Report to
Stockholders, a copy of which is filed as Exhibit 13 to this
Report.
Consolidated Statements of Income for the Years Ended
December 31, 1995, 1994 and 1993
Consolidated Balance Sheets at December 31, 1995 and 1994
Consolidated Statements of Cash Flows for the Years Ended
December 31, 1995, 1994 and 1993
Consolidated Statements of Stockholders' Equity for the
Years Ended December 31, 1995, 1994 and 1993
Notes to Consolidated Financial Statements
Report of Independent Accountants
(2) Financial Statement Schedules
The following additional information should be read in
conjunction with the Consolidated Financial Statements of the
Registrant described in Item 14(a)(1) above:
Financial Statement Schedules of the Registrant
Report of Independent Accountants, on page 4 of this
Report, relating to the financial statement schedule
Valuation and Qualifying Accounts Schedule, on page 5 of
this Report
Schedules other than the schedules listed above are omitted
because they are not required or are not applicable, or because
the information is furnished elsewhere in the financial
statements or the notes thereto.
(3) Exhibits*
The information required by this Item relating to Exhibits to
this Report is included in the Exhibit Index on pages 6 to 14
hereof.
(b) Reports on Form 8-K
The Company filed a Form 8-K Current Report dated October 12,
1995 in which it reported under Item 2 - "Acquisition or
Disposition of Assets" and Item 7 - "Financial Statements and
Exhibits" that it had effected the spin-off distribution, on a
pro rata basis, of 100% of the outstanding shares of common
stock of the Company's wholly owned subsidiary, TransPro, Inc.,
to holders of record of the Company's common stock as of the
close of business on September 29, 1995.
*A copy of any of the Exhibits to this Report will be furnished to
persons who request a copy upon the payment of a fee of $.25 per
page to cover the Company's duplication and handling expenses.
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors and Stockholders of
The Allen Group Inc.:
Our report on the consolidated financial statements of The Allen
Group Inc. has been incorporated by reference in this Annual Report
on Form 10-K from page 30 of the 1995 Annual Report to Stockholders
of The Allen Group Inc. In connection with our audits of such
financial statements, we have also audited the related financial
statement schedule listed in the Index on page 13 of this Form 10-K
Annual Report.
In our opinion, the financial statement schedule referred to
above, when considered in relation to the basic financial
statements taken as a whole, presents fairly, in all material
respects, the information required to be included therein.
COOPERS & LYBRAND L.L.P.
Cleveland, Ohio
February 16, 1996
<TABLE>
THE ALLEN GROUP INC.
SCHEDULE II VALUATION AND QUALIFYING ACCOUNTS
FOR THE THREE YEARS ENDED DECEMBER 31, 1995
(Amounts in Thousands)
<CAPTION>
Column A Column B Column C Column D Column E
Balance Additions Balance
at Charged to Charged Deductions at End
Beginning Costs and to Other from of
Description of Period Expenses Accounts Reserves Period
<S> <C> <C> <C> <C> <C>
Allowance for doubtful accounts:
1995 $ 1,684 592 - 1,044(1)(3) $ 1,232
1994 $ 1,270 417 - 3(1) $ 1,684
1993 $ 3,543 719 - 2,992(1)(2) $ 1,270
(1) Represents the write-off of uncollectible accounts, less recoveries.
(2) Includes the elimination of related balances for its Allen Testproducts division and leasing
subsidiary sold in 1993.
(3) Includes the elimination of related balances for its Truck Products Business spun off in 1995.
</TABLE>
EXHIBIT INDEX
Exhibit Numbers Pages
(3) Certificate of Incorporation and By Laws -
(a) Restated Certificate of Incorporation (filed as
Exhibit Number 3(a) to Registrant's Form 10-K
Annual Report for the fiscal year ended December
31, 1984 (Commission file number 1-6016) and
incorporated herein by reference).................. -
(b) Certificate of Designations, Powers, Preferences
and Rights of the $1.75 Convertible Exchangeable
Preferred Stock, Series A (filed as Exhibit Number
3(b) to Registrant's Form 10-K Annual Report for
the fiscal year ended December 31, 1986
(Commission file number 1-6016) and incorporated
herein by reference) .............................. -
(c) Certificate of Amendment of Restated Certificate
of Incorporation (filed as Exhibit Number 3(c) to
Registrant's Form 10-K Annual Report for the fiscal
year ended December 31, 1987 (Commission file number
1-6016) and incorporated herein by reference) ..... -
(d) Certificate of Designations, Powers, Preferences
and Rights of the Variable Rate Preferred Stock,
Series A (filed as Exhibit Number 3(d) to
Registrant's Form 10-K Annual Report for the fiscal
year ended December 31, 1987 (Commission file number
1-6016) and incorporated herein by reference)...... -
(e) Certificate of Designation, Preferences and Rights
of Series B Junior Participating Preferred Stock
(filed as Exhibit Number 3(e) to Registrant's
Form 10-K Annual Report for the fiscal year
ended December 31, 1987 (Commission file number
1-6016) and incorporated herein by reference)...... -
(f) Certificate Eliminating Variable Rate Preferred
Stock, Series A (filed as Exhibit Number 3(f) to
Registrant's Form 10-K Annual Report for the fiscal
year ended December 31, 1989 (Commission file
number 1-6016) and incorporated herein by
reference)......................................... -
(g) Certificate of Amendment of Restated Certificate
of Incorporation (filed as Exhibit Number 3(g) to
Registrant's Form 10-K Annual Report for the fiscal
year ended December 31, 1993 (Commission file number
1-6016) and incorporated herein by reference)...... -
(h) Certificate Eliminating $1.75 Convertible Exchangeable
Preferred Stock, Series A (filed as Exhibit Number 3(h)
to Registrant's Form 10-K Annual Report for the fiscal
year ended December 31, 1993 (Commission file number
1-6016) and incorporated herein by reference)...... -
(i) By-Laws, as amended through September 10, 1992 (filed
as Exhibit Number 3(g) to Registrant's Form 10-K
Annual Report for the fiscal year ended December 31,
1992 (Commission file number 1-6016) and
incorporated herein by reference).................. -
(4) Instruments defining the rights of security holders -
(a) Rights Agreement, dated as of January 7, 1988,
between the Registrant and Manufacturers Hanover
Trust Company (filed as Exhibit Number 4 to
Registrant's Form 8-K Current Report dated
January 7, 1988 (Commission file number 1-6016)
and incorporated herein by reference) ............. -
(b) Credit Agreement, dated as of December 18, 1995,
among the Registrant, MARTA Technologies, Inc.,
the Banks signatories thereto, and Bank of Montreal,
as agent .......................................... *
Additional information concerning Registrant's
long-term debt is set forth in Note 2, "Financing,"
of the Notes to Consolidated Financial Statements
on pages 20 to 21 of Registrant's 1995 Annual
Report to Stockholders, a copy of which is filed
as Exhibit 13 to this Report. Other than the
Credit Agreement referred to above, no instrument
defining the rights of holders of such long-term
debt relates to securities having an aggregate
principal amount in excess of 10% of the consolidated
assets of Registrant and its subsidiaries; therefore,
in accordance with paragraph (iii) of Item 4 of
Item 601(b) of Regulation S-K, the other instruments
defining the rights of holders of long-term debt
are not filed herewith. Registrant hereby agrees
to furnish a copy of any such other instrument to
the Securities and Exchange Commission upon request.
(10) Material contracts (Other than Exhibit 10(a), all
of the exhibits listed as material contracts
hereunder are management contracts or compensatory
plans or arrangements required to be filed as
exhibits to this Report pursuant to Item 14(c)
of this Report.)................................... -
(a) Contribution Agreement, dated September 29, 1995,
between Registrant and TransPro, Inc. (filed as
Exhibit Number 2.1 to Registrant's Form 8-K dated
October 12, 1995) (Commission file number 1-6016)
and incorporated herein by reference).............. -
(b) The Allen Group Inc. 1982 Stock Plan, as amended
through November 3, 1987 (filed as Exhibit Number
10(c) to Registrant's Form 10-K Annual Report for
the fiscal year ended December 31, 1987
(Commission file number 1-6016) and incorporated
herein by reference).............................. -
(c) Amendment, dated as of December 4, 1990, to The
Allen Group Inc. 1982 Stock Plan, as amended
(filed as Exhibit Number 10(d) to Registrant's
Form 10-K Annual Report for the fiscal year
ended December 31, 1990 (Commission file
number 1-6016) and incorporated herein
by reference)...................................... -
(d) Amendment, dated as of June 14, 1995, to The Allen
Group Inc. 1982 Stock Plan, as amended (filed as
Exhibit Number 10.1 to Registrant's Form 10-Q
Quarterly Report for the quarterly period ended
June 30, 1995 (Commission file number 1-6016) and
incorporated herein by reference .................. -
(e) Form of Restricted Stock Agreement pursuant to
The Allen Group Inc. 1982 Stock Plan, as amended
(filed as Exhibit Number 10(e) to Registrant's
Form 10-K Annual Report for the fiscal year ended
December 31, 1990 (Commission file number 1-6016)
and incorporated herein by reference).............. -
(f) The Allen Group Inc. 1992 Stock Plan (filed as
Exhibit Number 10(f) to Registrant's Form 10-K
Annual Report for the fiscal year ended December
31, 1992 (Commission file number 1-6016)
and incorporated herein by reference) ............. -
(g) Amendment to The Allen Group Inc. 1992 Stock Plan,
dated September 13, 1994 (filed as Exhibit Number
10 to the Registrant's Form 10-Q Quarterly Report
for the quarterly period ended September 30, 1994
(Commission file number 1-6016) and incorporated
herein by reference)............................... -
(h) Second Amendment to The Allen Group Inc. 1992
Stock Plan, dated February 23, 1994 (filed as
Exhibit Number 10(h) to Registrant's Form 10-K
Annual Report for the fiscal year ended December
31, 1994 (Commission file number 1-6016) and
incorporated herein by reference................... -
(i) Third Amendment to The Allen Group Inc. 1992 Stock
Plan, dated February 23, 1994 (filed as Exhibit
Number 10(i) to Registrant's Form 10-K Annual Report
for the fiscal year ended December 31, 1994
(Commission file number 1-6016) and incorporated
herein by reference) .............................. -
(j) Fourth Amendment to The Allen Group Inc. 1992 Stock
Plan, dated as of June 14, 1995 (filed as Exhibit
Number 10.2 to Registrant's Form 10-Q Quarterly
Report for the quarterly period ended June 30,
1995 (Commission file number 1-6016) and
incorporated herein by reference) ................. -
(k) Form of Restricted Stock Agreement pursuant to
1992 Stock Plan (Salary Increase Deferral),
dated November 30, 1993, entered into by the
Registrant with certain executive and divisional
officers (filed as Exhibit Number 10(g) to
Registrant's Form 10-K Annual Report for the fiscal
year ended December 31, 1993 (Commission file
number 1-6016) and incorporated herein by
reference) ........................................ -
(l) Form of Restricted Stock Agreement pursuant to
1992 Stock Plan (Salary Increase Deferral), dated
April 28, 1992, entered into by the Registrant
with certain executive and divisional officers
(filed as Exhibit Number 10(g) to Registrant's
Form 10-K Annual Report for the fiscal year
ended December 31, 1992 (Commission file
number 1-6016) and incorporated herein by
reference) ........................................ -
(m) Amendment to Restricted Stock Agreements pursuant
to 1992 Stock Plan (Salary Increase Deferral),
dated February 22, 1995 (filed as Exhibit Number
10(l) to Registrant's Form 10-K Annual Report for
the fiscal year ended December 31, 1994
(Commission file number 1-6016) and incorporated
herein by reference) .............................. -
(n) Form of Non-Qualified Option to Purchase Stock
granted to certain directors of the Registrant
on September 12, 1989 (filed as Exhibit Number
10(e) to Registrant's Form 10-K Annual Report
for the fiscal year ended December 31, 1989
(Commission file number 1-6016) and incorporated
herein by reference) .............................. -
(o) The Allen Group Inc. 1994 Non-Employee Directors
Stock Option Plan (filed as Exhibit A to
Registrant's Proxy Statement dated March 17,
1994 (Commission file number 1-6016) and incor-
porated herein by reference) ...................... -
(p) Form of Non-Qualified Option to Purchase Stock
pursuant to The Allen Group Inc. 1994
Non-Employee Directors Stock Option Plan (filed
as Exhibit Number 10(o) to Registrant's Form
10-K Annual Report for the fiscal year ended
December 31, 1994 (Commission file number 1-6016)
and incorporated herein by reference)............. -
(q) The Allen Group Inc. Amended and Restated Key
Management Deferred Bonus Plan (incorporating
all amendments through February 27, 1992) (filed
as Exhibit Number 10(i) to Registrant's Form 10-K
Annual Report for the fiscal year ended December
31, 1992 (Commission file number 1-6016) and
incorporated herein by reference)................. -
(r) Form of Restricted Stock Agreement pursuant to
1992 Stock Plan and Key Management Deferred
Bonus Plan (filed as Exhibit Number 10(j) to
Registrant's Form 10-K Annual Report for the
fiscal year ended December 31, 1992 (Commission
file number 1-6016) and incorporated herein
by reference)...................................... -
(s) Form of Severance Agreement, dated as of
November 3, 1987, entered into by the
Registrant with certain executive officers,
officers and division presidents (filed as
Exhibit Number 10(g) to Registrant's Form
10-K Annual Report for the fiscal year ended
December 31, 1987 (Commission file number 1-6016)
and incorporated herein by reference) ............. -
(t) Form of Amendment, dated December 5, 1989,
to Severance Agreement entered into by the
Registrant with certain executive officers,
officers and division presidents (filed as
Exhibit Number 10(j) to Registrant's Form 10-K
Annual Report for the fiscal year ended December
31, 1989 (Commission file number 1-6016) and
incorporated herein by reference) ................. -
(u) The Allen Group Inc. Master Discretionary Severance
Pay Plan, effective January 1, 1993 (filed as
Exhibit 10(t) to Registrant's Form 10-K Annual
Report for the fiscal year ended December 31, 1994
(Commission file number 1-6016) and incorporated
herein by reference) .............................. -
(v) Key Employee Severance Policy adopted by the
Registrant on November 3, 1987 (filed as Exhibit
Number 10(h) to Registrant's Form 10-K Annual
Report for the fiscal year ended December 31, 1987
(Commission file number 1-6016) and incorporated
herein by reference) .............................. -
(w) Amendment, dated May 14, 1991, to Key Employee
Severance Policy adopted by the Registrant on
November 3, 1987 (filed as Exhibit Number 10(n) to
Registrant's Form 10-K Annual Report for the
fiscal year ended December 31, 1992 (Commission
file number 1-6016) and incorporated herein
by reference) ..................................... -
(x) Amendment No. 2, dated February 22, 1996, to Key
Employee Severance Policy.......................... *
(y) Employment Agreement, dated June 28, 1988, between
the Registrant and Philip Wm. Colburn (filed as
Exhibit Number 10(m) to Registrant's Form 10-K
Annual Report for the fiscal year ended December 31,
1988 (Commission file number 1-6016) and incorporated
herein by reference) .............................. -
(z) Amendment, dated as of February 27, 1992, of
Employment Agreement, dated June 28, 1988, between
the Registrant and Philip Wm. Colburn (filed as
Exhibit Number 10(p) to Registrant's Form 10-K
Annual Report for the fiscal year ended December
31, 1992 (Commission file number 1-6016) and
incorporated herein by reference) ................. -
(aa) Amendment, dated as of February 26, 1991, of
Employment Agreement, dated June 28, 1988, between
the Registrant and Philip Wm. Colburn (filed as
Exhibit Number 10(n) to Registrant's Form 10-K
Annual Report for the fiscal year ended December
31, 1990 (Commission file number 1-6016) and
incorporated herein by reference) ................. -
(bb) Amended and Restated Post Employment Consulting
Agreement, dated as of December 20, 1990, between
the Registrant and Philip Wm. Colburn (filed as
Exhibit Number 10(o) to Registrant's Form 10-K
Annual Report for the fiscal year ended December
31, 1990 (Commission file number 1-6016) and
incorporated herein by reference) ................. -
(cc) Amended and Restated Supplemental Pension Benefit
Agreement, dated as of December 20, 1990, between
the Registrant and Philip Wm. Colburn (filed as
Exhibit Number 10(p) to Registrant's Form 10-K
Annual Report for the fiscal year ended December 31,
1990 (Commission file number 1-6016) and
incorporated herein by reference) ................. -
(dd) Insured Supplemental Retirement Benefit Agreement,
dated as of September 4, 1985, between the Registrant
and Philip Wm. Colburn (filed as Exhibit Number 10(l)
to Registrant's Form 10-K Annual Report for the fiscal
year ended December 31, 1987 (Commission file number
1-6016) and incorporated herein by reference) ..... -
(ee) Split Dollar Insurance Agreement, dated as of July 1,
1991, between the Registrant and Philip Wm. Colburn
(filed as Exhibit Number 10(u) to Registrant's Form 10-K
Annual Report for the fiscal year ended December 31,
1992 (Commission file number 1-6016) and incorporated
herein by reference................................ -
(ff) Supplemental Pension Benefit Agreement, dated
as of December 6, 1983, between the Registrant
and J. Chisholm Lyons (filed as Exhibit Number
10(r) to Registrant's Form 10-K Annual Report for
the fiscal year ended December 31, 1983
(Commission file number 1-6016) and incorporated
herein by reference)............................... -
(gg) Amendment, dated as of December 20, 1990, of
Supplemental Pension Benefit Agreement, dated
as of December 6, 1983, between the Registrant
and J. Chisholm Lyons (filed as Exhibit Number
10(s) to Registrant's Form 10-K Annual Report
for the fiscal year ended December 31, 1990
(Commission file number 1-6016) and incorporated
herein by reference).............................. -
(hh) Post Employment Consulting Agreement, dated as
of September 12, 1989, between the Registrant
and J. Chisholm Lyons (filed as Exhibit Number
10(s) to Registrant's Form 10-K Annual Report
for the fiscal year ended December 31, 1989
(Commission file number 1-6016) and incorporated
herein by reference) .............................. -
(ii) Amendment, dated as of December 20, 1990, of
Post Employment Consulting Agreement, dated as of
September 12, 1989, between the Registrant and
J. Chisholm Lyons (filed as Exhibit Number 10(u)
to Registrant's Form 10-K Annual Report for the
fiscal year ended December 31, 1990 (Commission
file number 1-6016) and incorporated herein
by reference) ..................................... -
(jj) Employment Agreement, dated June 25, 1991, between
the Registrant and Robert G. Paul (filed as Exhibit
Number 10(x) to Registrant's Form 10-K Annual
Report for the fiscal year ended December 31, 1991
(Commission file number 1-6016) and incorporated
herein by reference) .............................. -
(kk) Supplemental Target Pension Benefit Agreement, dated
as of January 1, 1996, between the Registrant and
Robert G. Paul.................................... *
(ll) Form of Split Dollar Insurance Agreement, dated as
of November 1, 1991, entered into by the Registrant
with certain executive and divisional officers
(filed as Exhibit Number 10(bb) to Registrant's Form
10-K Annual Report for the fiscal year ended December
31, 1992 (Commission file number 1-6016) and
incorporated herein by reference .................. -
(mm) The Allen Group Inc. Deferred Compensation Plan,
effective December 1, 1995 ........................ *
(nn) The Allen Group Inc. Restoration Plan, effective
January 1, 1996 ................................... *
(oo) Comsearch Division Supplemental Savings Plan,
effective January 1, 1995 ......................... *
(pp) Form of Supplemental Target Pension Benefit Agreement,
dated as of January 1, 1996, entered into by the
Registrant with certain executive and divisional
officers .......................................... *
(11) Statement re Computation of Earnings Per
Common Share ...................................... *
(13) 1995 Annual Report to Stockholders**............... *
(21) Subsidiaries of the Registrant .................... *
(23) Consent of Independent Accountants ................ 15
(27) Financial Data Schedule ........................... *
(99)(a) Annual Report on Form 11-K of The Allen Group
Inc. Employee Stock Savings Plan for the fiscal
year ended December 31, 1995...................... 17
(b) Annual Report on Form 11-K of The Allen Group
Inc. Employee Before-Tax Savings Plan for the
fiscal year ended December 31, 1995............... 25
* Previously filed March 28, 1996.
** Furnished for the information of the Securities and Exchange
Commission and not to be deemed "filed" as part of this Report
except for the Consolidated Financial Statements of the
Registrant and the Accountants' Report on pages 15 to 30 of
said Annual Report to Stockholders and the other information
incorporated by reference in Items 1 and 3 of Part I hereof and
Items 5 to 8 of Part II hereof.
A copy of any of these Exhibits will be furnished to persons who
request a copy upon the payment of a fee of $.25 per page to
cover the Company's duplication and handling expenses.
Exhibit 23
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in the
Registration Statement on Form S-3 (File No. 33-48545) and on the
Registration Statements on Form S-8 (File Nos. 33-58951, 33-53499,
33-53487, 33-52420, 33-8658 and 2-99919) and the related
Prospectuses of The Allen Group Inc. of (a) our report dated
February 16, 1996 on our audits of the consolidated financial
statements of The Allen Group Inc. as of December 31, 1995 and 1994
and for the years ended December 31, 1995, 1994, 1993, which report
has been incorporated by reference in this Annual Report on Form
10-K from the 1995 Annual Report to Stockholders of The Allen Group
Inc. (a copy of which is filed as Exhibit 13 to this Report) and
appears on page 30 therein, and (b) our report dated February 16,
1996 on our audits of the financial statement schedule for the
years ended December 31, 1995, 1994 and 1993 of The Allen Group
Inc., which report appears on page 14 in this Annual Report on
Form 10-K. We also consent to the references to our firm in the
above-mentioned Prospectuses under the caption "EXPERTS".
COOPERS & LYBRAND L.L.P.
Cleveland, Ohio
March 29, 1996
CONSENTS OF INDEPENDENT ACCOUNTS (Continued)
We consent to the incorporation by reference in the Registration
Statement on Form S-8 (File No. 33-8658) and the related Prospectus
of The Allen Group Inc. of our report dated April 25, 1996 on our
audits of the financial statements of The Allen Group Inc. Employee
Stock Savings Plan as of December 31, 1995 and 1994 and for the years
ended December 31, 1995, 1994 and 1993, which report is included in
the Annual Report on Form 11-K of The Allen Group Inc. Employee Stock
Savings Plan, a copy of which is filed as Exhibit Number 99(a) to
this Annual Report on Form 10-K.
Coopers & Lybrand, L.L.P.
Cleveland, Ohio
April 29, 1996
We consent to the incorporation by reference in the Registration
Statements on Form S-8 (File Nos. 33-53487 and 2-99919) and the
related Prospectuses of The Allen Group Inc. of our report dated
April 25, 1996 on our audits of the financial statements of The Allen
Group Inc. Employee Before-Tax Savings Plan as of December 31, 1994
and 1993 and for the years ended December 31, 1994, 1993 and 1992,
which report is included in the Annual Report on Form 11-K of The
Allen Group Inc. Employee Before-Tax Savings Plan, a copy of which is
filed as Exhibit Number 99(b) to this Annual Report on Form 10-K.
Coopers & Lybrand, L.L.P.
Cleveland, Ohio
April 29, 1996
EXHIBIT 99 (b)
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
ANNUAL REPORT
PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
(Mark One):
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED].
For the fiscal year ended December 31, 1995
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED].
For the transition period from ______ to ______
Commission file number 1-6016
A. Full title of the plan and the address of the plan, if
different from that of the issuer named below:
THE ALLEN GROUP INC. EMPLOYEE BEFORE-TAX SAVINGS PLAN
(the "Plan")
B. Name of issuer of the securities held pursuant to the
Plan and the address of its principal executive office:
THE ALLEN GROUP INC. (the "Company")
25101 Chagrin Boulevard
Beachwood, Ohio 44122<PAGE>
THE ALLEN GROUP INC.
EMPLOYEE BEFORE-TAX SAVINGS PLAN
FORM 11-K
(For the fiscal year ended December 31, 1995)
Table of Contents
Page
Financial Statements
(i) Report of Independent Accountants 3
(ii) Statements of Financial Condition -
December 31, 1995 and 1994 4 - 5
(iii) Statements of Income and Changes
in Plan Equity for the years
ended December 31, 1993, 1994
and 1995 6 - 14
(iv) Notes to Financial Statements 15 - 24
Schedules are omitted because they are not required or
not applicable or because the information is furnished
elsewhere in the financial statements or the notes
thereto.
REPORT OF INDEPENDENT ACCOUNTANTS
To the Employee Before-Tax Savings Plan Committee
and the Participants in The Allen Group Inc.
Employee Before-Tax Savings Plan:
We have audited the accompanying statements of financial condition
of THE ALLEN GROUP INC. EMPLOYEE BEFORE-TAX SAVINGS PLAN as of
December 31, 1995 and 1994, and the related statements of income
and changes in plan equity for each of the three years in the
period ended December 31, 1995. These financial statements are the
responsibility of the Plan's management. Our responsibility is to
express an opinion on these financial statements based on our
audits.
We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the
amounts and disclosures in the financial statements. An audit also
includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial condition of THE
ALLEN GROUP INC. EMPLOYEE BEFORE-TAX SAVINGS PLAN as of December
31, 1995 and 1994 and the results of its operations and changes in
plan equity for each of the three years in the period ended
December 31, 1995 in conformity with generally accepted accounting
principles.
Our audits were made for the purpose of forming an opinion on the
basic financial statements taken as a whole. The Fund information
in the statements of financial condition and the statements of
income and changes in plan equity is presented for purposes of
additional analysis rather than to present the financial condition
and changes in plan equity of each fund. The Fund information has
been subjected to the auditing procedures applied in the audit of
the basic financial statements and, in our opinion, is fairly
stated in all material respects in relation to the basic financial
statements taken as a whole.
COOPERS & LYBRAND L.L.P.
Cleveland, Ohio
April 25, 1996
<TABLE>
THE ALLEN GROUP INC. EMPLOYEE BEFORE-TAX SAVINGS PLAN
STATEMENTS OF FINANCIAL CONDITION
DECEMBER 31, 1995 AND 1994
<CAPTION>
Fidelity Fidelity Fidelity Allen
Managed Equity - Retirement Common Hartford
Income Income Growth Stock Fixed-Income Sub-Total
Portfolio Fund Fund Fund Fund (To Page 5)
<S> <C> <C> <C> <C> <C> <C>
December 31, 1995
Investments, at market
value (Note 3) $ - $3,243,579 $2,988,236 $7,161,566 $3,236,892 $16,630,273
Loans receivable from
participants (Note 6) - - - - - -
Contribution receivable
(Note 4):
Participants - 49,129 55,313 98,140 - 202,582
Company - 48,681 65,813 158,119 - 272,613
Other receivables 137 5,753 5,242 13,994 77 25,203
Cash and equivalents 107 - - 55,883 17,128 73,118
Other payables - - - (8,088) - (8,088)
Plan Equity, End of Year $ 244 $3,347,142 $3,114,604 $7,479,614 $3,254,097 $17,195,701
December 31, 1994
Investments, at market
value (Note 3) $2,102,640 $2,037,464 $1,851,069 $5,425,976 $4,226,733 $15,643,882
Loans receivable from
participants (Note 6) - - - - - -
Contribution receivable
(Note 4):
Participants 49,849 68,779 124,985 48,320 - 291,933
Company 49,139 35,516 41,102 179,453 1,165 306,375
Other receivables 39,057 12,848 10,074 47,655 1,532 111,166
Cash and equivalents 70,846 49,084 49,203 53,228 70,588 292,949
Other payables (3,270) (3,105) (2,940) (8,139) (6,068) (23,522)
Plan Equity, End of Year $2,308,261 $2,200,586 $2,073,493 $5,746,493 $4,293,950 $16,622,783
The Notes are an integral part of these statements.
</TABLE>
<TABLE>
THE ALLEN GROUP INC. EMPLOYEE BEFORE-TAX SAVINGS PLAN
STATEMENTS OF FINANCIAL CONDITION
DECEMBER 31, 1995 AND 1994
<CAPTION>
Carryforward TransPro Morley Participant
Total Common Stock Stable Loan
(From Page 4) Fund Fund Account Total
<S> <C> <C> <C> <C> <C>
December 31, 1995
Investments, at market
value (Note 3) $16,630,273 $ 152,023 $2,644,254 $ - $19,426,550
Loans receivable from
participants (Note 6) - - - 982,716 982,716
Contribution receivable
(Note 4):
Participants 202,582 - 32,125 - 234,707
Company 272,613 - 33,899 - 306,512
Other receivables 25,203 - 11,186 - 36,389
Cash and equivalents 73,118 11,771 - - 84,889
Other payables (8,088) - (44,245) (30,204) (82,537)
Plan Equity, End of Year $17,195,701 $ 163,794 $2,677,219 $ 952,512 $20,989,226
December 31, 1994
Investments, at market
value (Note 3) $15,643,882 $ - $ - $ - $15,643,882
Loans receivable from
participants (Note 6) - - - 1,002,668 1,002,668
Contribution receivable
(Note 4):
Participants 291,933 - - - 291,933
Company 306,375 - - - 306,375
Other receivables 111,166 - - 152 111,318
Cash and equivalents 292,949 - - 78,485 371,434
Other payables (23,522) - - (14,902) (38,424)
Plan Equity, End of Year $16,622,783 $ - $ - $1,066,403 $17,689,186
The Notes are an integral part of these statements.
</TABLE>
<TABLE>
THE ALLEN GROUP INC. EMPLOYEE BEFORE-TAX SAVINGS PLAN
STATEMENTS OF INCOME AND CHANGES IN PLAN EQUITY
DECEMBER 31, 1993, 1994 AND 1995
<CAPTION>
Fidelity Fidelity Fidelity Allen
Managed Equity - Retirement Common Hartford
Income Income Growth Stock Fixed-Income Sub-Total
Portfolio Fund Fund Fund Fund (To Page 9)
<S> <C> <C> <C> <C> <C> <C>
1993
Plan Equity,
January 1, 1993 $1,547,957 $1,756,079 $1,324,581 $3,484,661 $ - $8,113,278
Contributions (Note 4) 201,051 243,129 200,665 730,244 - 1,375,089
Investment income:
Dividends 5,611 49,347 - 26,381 - 81,339
Interest 80,840 17,293 82,315 485 - 180,933
Net appreciation in
the fair value of
investments - 61,167 99,136 2,438,171 - 2,598,474
Withdrawals and dis-
tributions (Note 5) (639,428) (789,923) (673,986) (3,724,336) - (5,827,673)
Interfund Activity:
Interfund transfers 55,106 (114,561) (97,940) 124,248 - (33,147)
Interfund loans 17,774 13,430 11,851 (6,336) - 36,719
Cumulative change in
accounting principle
(Note 2) 3,747 1,172 1,211 50,842 - 56,972
Plan Equity, December 31,
1993 (to Page 7) $1,272,658 $1,237,133 $ 947,833 $3,124,360 $ - $6,581,984
The Notes are an integral part of these statements.
</TABLE>
<TABLE>
THE ALLEN GROUP INC. EMPLOYEE BEFORE-TAX SAVINGS PLAN
STATEMENTS OF INCOME AND CHANGES IN PLAN EQUITY
DECEMBER 31, 1993, 1994 AND 1995
Fidelity Fidelity Fidelity Allen
Managed Equity - Retirement Common Hartford
Income Income Growth Stock Fixed-Income Sub-Total
Portfolio Fund Fund Fund Fund (To Page 10)
<S> <C> <C> <C> <C> <C> <C>
Plan Equity, December 31,
1993 (from Page 6) $1,272,658 $1,237,133 $ 947,833 $3,124,360 $ - $ 6,581,984
1994
Contributions (Note 4) 406,474 387,887 436,287 1,015,728 130,688 2,377,064
Investment income:
Dividends - - - 35,356 - 35,356
Interest 82,284 83,334 28,964 - 298,890 493,472
Net appreciation (depre-
ciation) in the fair
value of investments - (99,318) (50,771) 1,301,653 - 1,151,564
Withdrawals and dis-
tributions (Note 5) (97,050) (59,506) (56,649) (160,532) (411,203) (784,940)
Administrative expenses (3,270) (3,105) (2,940) (10,184) (18,062) (37,561)
Interfund Activity:
Interfund transfers (9,163) 7,446 29,854 (17,970) (92,738) (82,571)
Interfund loans 6,921 (75,557) (58,952) 23,845 (89,954) (193,697)
Rollover of ATG Funds to
Allen Funds (Note 1) 649,407 722,272 799,867 434,237 (26,673) 2,579,110
Rollover from ATG Savings and
Incentive Plan (Note 1) - - - - 4,503,002 4,503,002
Plan Equity, December 31,
1994 (to Page 8) $2,308,261 $2,200,586 $2,073,493 $5,746,493 $4,293,950 $16,622,783
The Notes are an integral part of these statements.
</TABLE>
<TABLE>
THE ALLEN GROUP INC. EMPLOYEE BEFORE-TAX SAVINGS PLAN
STATEMENTS OF INCOME AND CHANGES IN PLAN EQUITY
DECEMBER 31, 1993, 1994 AND 1995
<CAPTION>
Fidelity Fidelity Fidelity Allen
Managed Equity - Retirement Common Hartford
Income Income Growth Stock Fixed-Income Sub-Total
Portfolio Fund Fund Fund Fund (To Page 11)
<S> <C> <C> <C> <C> <C> <C>
Plan Equity, December 31,
1994 (from Page 7) $2,308,261 $2,200,586 $2,073,493 $5,746,493 $4,293,950 $16,622,783
1995
Contributions (Note 4) 354,783 524,288 544,367 1,624,657 21,251 3,069,346
Investment income:
Dividends - 172,995 260,187 39,775 - 472,957
Interest 139,474 1,587 1,740 5,077 234,076 381,954
Spin-off distribution
(Note 8) - - - - - -
Other income - - - 44,836 4,180 49,016
Net appreciation (depre-
ciation) in the fair
value of investments - 526,252 274,750 (425,550) - 375,452
Withdrawals and dis-
tributions (Note 5) (333,690) (238,287) (209,210) (553,210) (253,100) (1,587,497)
Administrative expenses (39,410) (8,141) (1,790) (27,797) (47,259) (124,397)
Interfund Activity:
Interfund transfers (2,444,355) 182,057 177,541 954,763 (788,654) (1,918,648)
Interfund loans 15,181 (14,195) (6,474) 70,570 (210,347) (145,265)
Plan Equity,
December 31, 1995 $ 244 $3,347,142 $3,114,604 $7,479,614 $3,254,097 $17,195,701
The Notes are an integral part of these statements.
</TABLE>
<TABLE>
THE ALLEN GROUP INC. EMPLOYEE BEFORE-TAX SAVINGS PLAN
STATEMENTS OF INCOME AND CHANGES IN PLAN EQUITY
DECEMBER 31, 1993, 1994 AND 1995
<CAPTION>
Carryforward TransPro Morley Participant
Total Common Stock Stable Loan Sub-Total
(From Page 6) Fund Fund Account (To Page 12)
<S> <C> <C> <C> <C> <C>
1993
Plan Equity,
January 1, 1993 $8,113,278 $ - $ - $ 253,072 $8,366,350
Contributions (Note 4) 1,375,089 - - - 1,375,089
Investment income:
Dividends 81,339 - - - 81,339
Interest 180,933 - - 13,451 194,384
Net appreciation in
the fair value of
investments 2,598,474 - - - 2,598,474
Withdrawals and dis-
tributions (Note 5) (5,827,673) - - - (5,827,673)
Interfund Activity:
Interfund transfers (33,147) - - 33,147 -
Interfund loans 36,719 - - (36,719) -
Cumulative change in
accounting principle
(Note 2) 56,972 - - - 56,972
Plan Equity, December 31,
1993 (to Page 10) $6,581,984 - - $ 262,951 $6,844,935
The Notes are an integral part of these statements.
</TABLE>
<TABLE>
THE ALLEN GROUP INC. EMPLOYEE BEFORE-TAX SAVINGS PLAN
STATEMENTS OF INCOME AND CHANGES IN PLAN EQUITY
DECEMBER 31, 1993, 1994 AND 1995
<CAPTION>
Carryforward TransPro Morley Participant
Total Common Stock Stable Loan Sub-Total
(From Page 7) Fund Fund Account (To Page 13)
<S> <C> <C> <C> <C> <C>
Plan Equity, December 31,
1993 (from Page 9) $ 6,581,984 $ - $ - $ 262,951 $ 6,844,935
1994
Contributions (Note 4) 2,377,064 - - - 2,377,064
Investment income:
Dividends 35,356 - - - 35,356
Interest 493,472 - - 17,950 511,422
Net appreciation (depre-
ciation) in the fair
value of investments 1,151,564 - - - 1,151,564
Withdrawals and dis-
tributions (Note 5) (784,940) - - - (784,940)
Administrative expenses (37,561) - - (1,675) (39,236)
Interfund Activity:
Interfund transfers (82,571) - - 5,446 (77,125)
Interfund loans (193,697) - - 207,539 13,842
Rollover of ATG Funds to
Allen Funds (Note 1) 2,579,110 - - - 2,579,110
Rollover from ATG Savings
and Incentive Plan
(Note 1) 4,503,002 - - 574,192 5,077,194
Plan Equity, December 31,
1994 (To Page 11) $16,622,783 $ - $ - $1,066,403 $17,689,186
The Notes are an integral part of these statements.
</TABLE>
<TABLE>
THE ALLEN GROUP INC. EMPLOYEE BEFORE-TAX SAVINGS PLAN
STATEMENTS OF INCOME AND CHANGES IN PLAN EQUITY
DECEMBER 31, 1993, 1994 AND 1995
Carryforward TransPro Morley Participant
Total Common Stock Stable Loan Sub-Total
(From Page 8) Fund Fund Account (To Page 14)
<S> <C> <C> <C> <C> <C>
Plan Equity, December
31, 1994 (from Page 10) $16,622,783 $ - $ - $ 1,066,403 $17,689,186
1995
Contributions (Note 4) 3,069,346 - 147,826 - 3,217,172
Investment income:
Dividends 472,957 - - - 472,957
Interest 381,954 119 812 96,715 479,600
Spin-off distribution
(Note 8) - 847,930 - - 847,930
Other income 49,016 - - - 49,016
Net appreciation (depre-
ciation) in the fair
value of investments 375,452 (142,249) 3,937 - 237,140
Withdrawals and dis-
tributions (Note 5) (1,587,497) (31,561) (2,734) (213,338) (1,835,130)
Administrative expenses (124,397) (3) (44,245) - (168,645)
Interfund Activity:
Interfund transfers (1,918,648) (510,442) 2,559,110 (130,020) -
Interfund loans (145,265) - 12,513 132,752 -
Plan Equity, December 31,
1995 $17,195,701 $ 163,794 $2,677,219 $ 952,512 $20,989,226
The Notes are an integral part of these statements.
</TABLE>
<TABLE>
THE ALLEN GROUP INC. EMPLOYEE BEFORE-TAX SAVINGS PLAN
STATEMENTS OF INCOME AND CHANGES IN PLAN EQUITY
DECEMBER 31, 1993, 1994 AND 1995
<CAPTION>
Twentieth Twentieth
Carryforward Century Century Vanguard
Total Ultra Select Fixed
(From Page 9) Fund Fund Fund Total
<S> <C> <C> <C> <C> <C>
1993
Plan Equity,
January 1, 1993 $8,366,350 $ - $ - $ - $8,366,350
Contributions (Note 4) 1,375,089 - - - 1,375,089
Investment income:
Dividends 81,339 - - - 81,339
Interest 194,384 - - - 194,384
Net appreciation in
the fair value of
investments 2,598,474 - - - 2,598,474
Withdrawals and dis-
tributions (Note 5) (5,827,673) - - - (5,827,673)
Interfund Activity:
Interfund transfers - - - - -
Interfund loans - - - - -
Cumulative change in
accounting principle
(Note 2) 56,972 - - - 56,972
Plan Equity, December 31,
1993 (to Page 13) $6,844,935 $ - $ - $ - $6,844,935
The Notes are an integral part of these statements.
</TABLE>
<TABLE>
THE ALLEN GROUP INC. EMPLOYEE BEFORE-TAX SAVINGS PLAN
STATEMENTS OF INCOME AND CHANGES IN PLAN EQUITY
DECEMBER 31, 1993, 1994 AND 1995
<CAPTION>
Twentieth Twentieth
Carryforward Century Century Vanguard
Total Ultra Select Fixed
(From Page 10) Fund Fund Fund Total
<S> <C> <C> <C> <C> <C>
Plan Equity, December 31,
1993 (from Page 12) $ 6,844,935 $ - $ - $ - $6,844,935
1994
Contributions (Note 4) 2,377,064 44,921 35,848 25,655 2,483,488
Investment income:
Dividends 35,356 - - - 35,356
Interest 511,422 3,209 2,665 45,792 563,088
Net appreciation (depre-
ciation) in the fair
value of investments 1,151,564 (79,579) (72,737) (95,267) 903,981
Withdrawals and dis-
tributions (Note 5) (784,940) (155,351) (219,756) (38,751) (1,198,798)
Administrative expenses (39,236) (1,453) (1,366) (1,086) (43,141)
Interfund Activity:
Interfund transfers (77,125) 33,803 6,067 37,255 -
Interfund loans 13,842 (3,984) 2,447 (12,305) -
Rollover of ATG Funds to
Allen Funds (Note 1) 2,579,110 (957,537) (902,859) (718,714) -
Rollover from ATG Savings
and Incentive Plan
(Note 1) 5,077,194 1,115,971 1,149,691 757,421 8,100,277
Plan Equity, December 31,
1994 (to Page 14) $17,689,186 $ - $ - $ - $17,689,186
The Notes are an integral part of these statements.
</TABLE>
<TABLE>
THE ALLEN GROUP INC. EMPLOYEE BEFORE-TAX SAVINGS PLAN
STATEMENTS OF INCOME AND CHANGES IN PLAN EQUITY
DECEMBER 31, 1993, 1994 AND 1995
<CAPTION>
Twentieth Twentieth
Carryforward Century Century Vanguard
Total Ultra Select Fixed
(From Page 11) Fund Fund Fund Total
<S> <C> <C> <C> <C> <C>
Plan Equity, December
31, 1994 (from Page 13) $17,689,186 $ - $ - $ - $17,689,186
1995
Contributions (Note 4) 3,217,172 - - - 3,217,172
Investment income:
Dividends 472,957 - - - 472,957
Interest 479,600 - - - 479,600
Spin-off distribution
(Note 8) 847,930 - - - 847,930
Other income 49,016 - - - 49,016
Net appreciation in
the fair value
of investments 237,140 - - - 237,140
Withdrawals and dis-
tributions (Note 5) (1,835,130) - - - (1,835,130)
Administrative expenses (168,645) - - - (168,645)
Interfund Activity:
Interfund transfers - - - - -
Interfund loans - - - - -
Plan Equity, December 31,
1995 $20,989,226 $ - $ - $ - $20,989,226
The Notes are an integral part of these statements.
</TABLE>
THE ALLEN GROUP INC. EMPLOYEE BEFORE-TAX SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
1. OPERATIONS
The Allen Group Inc. Employee Before-Tax Savings Plan (the
"Plan") is designed to offer employees of The Allen Group Inc. (the
"Company"), who choose to participate, a form of savings that
allows for a deferral of current income taxes while saving for
retirement. The Plan is administered by The Allen Group Inc.
Employee Before-Tax Savings Plan Committee (the "Committee") which
is comprised of management personnel and officers of the Company.
Effective January 1, 1994, the Company merged the Allen
Telecom Group, Inc. ("ATG") Savings and Incentive Plan (formerly
the Alliance Telecommunications Corporation Savings and Incentive
Plan) (the "ATG Plan") into the Plan. As a result of the merger,
all assets and liabilities of the ATG Plan were transferred to the
Plan as of the effective date, and the Plan was amended such that
all ATG Plan participants became participants of the Plan.
Subsequent to the initial transfer, the former ATG Plan
participants were directed to reallocate contributions into The
Allen Group Inc. Before-Tax Savings Plan investment funds as the
former ATG Plan investment funds were planned to be discontinued.
During the reallocation process, however, it was determined that
significant penalties would be incurred if the Hartford Fixed-
Income Fund were fully liquidated at that time. As a result, the
Company decided to maintain the Hartford Fixed-Income Fund as an
investment option for all Plan participants in 1994 and 1995. In
1996, the Hartford Fund was liquidated with the applicable
transaction fees being paid by the Company. In addition, all ATG
Plan participant loan account balances were transferred into the
Allen Participant Loan Account as of December 31, 1994.
2. SUMMARY OF ACCOUNTING POLICIES
Participants' contributions to the Plan are invested by the
Trustee (The Charles Schwab Trust Company) in the Investment Funds
(described in Note 4), which include the Allen Common Stock Fund,
as directed by participants. The Company's contributions to the
Plan, if any, are invested by the Trustee exclusively in the Allen
Common Stock Fund, with the exception that, to avoid the retention
of idle funds, investments are made in cash equivalent securities
prior to investment in such Investment Funds. Investments are
stated at market value. Shares in the Allen Common Stock Fund and
TransPro, Inc. Common Stock Fund (See Note 8) are valued at the
last sale price of the respective Company's common stock on the New
York Stock Exchange Composite Tape on the last business day of the
year. Investments in the Fidelity Equity-Income Fund, Inc.,
Fidelity Retirement Growth Fund and the Morley Stable Value Fund
are valued at their respective net asset value per unit as quoted
by the National Association of Security Dealers on the last
business day of the year. During 1995, there was a conversion of
plan assets in the Fidelity Managed Income Portfolio to the Morley
Stable Value Fund. In addition, effective November 1, 1995,
contributions previously directed to the Hartford Fixed-Income Fund
are being invested in the Morley Stable Value Fund. Previously,
investments in the Fidelity Managed Income Portfolio were valued at
cost plus accrued interest which approximated market value. The
Hartford Fixed-Income Fund consists of a deposit administration
contract with the ITT Hartford Life Insurance Company ("Hartford")
which maintained the contributions in a pooled account. The
investment is included in the accompanying financial statements at
December 31, 1995 at the contract value reported to the Plan by
Hartford. Contract value represents contributions made under the
contract, plus interest at the contract rate, less funds used to
purchase withdrawal annuities and pay administrative expenses.
Funds under the contract that have been allocated and applied to
purchase annuities (that is, Hartford is obligated to pay the
related benefits and not the Plan) are excluded from the Plan's
assets.
The Plan uses the accrual method for recognizing contributions
and investment income. Prior to 1993, the Plan also used the
accrual method for recognizing undistributed withdrawals. However,
this method of accounting was changed in 1993 to conform with
professional guidance issued by the American Institute of Certified
Public Accountants and, as a result, the Plan no longer accounts
for amounts owed to withdrawing but unpaid former participants and
participant loans in process as liabilities. The financial
statements for the year ended December 31, 1993 include the
cumulative change in accounting principle in the statement of
income and changes in plan equity. Dividends are accrued on the
ex-dividend date. Withdrawals and distributions are valued using
current market prices at the time withdrawals and distributions are
made.
The Plan presents in the statements of income and changes in
plan equity the net appreciation (depreciation) in the fair value
of its investments which consists of the realized gains or losses
and the unrealized appreciation (depreciation) on those
investments.
During 1994, the Plan was amended such that all administrative
expenses are now paid by the Plan from Forfeiture Funds, to the
extent that Forfeiture Funds are available; otherwise,
administrative expenses will be paid directly by the Plan, unless
the Company elects to pay any such costs. Prior to this amendment,
all expenses of administering the Plan, including the Trustee's
fees, were paid by the Company. In addition, there is a fixed
charge of $50 for second and third loan applications which is borne
by those specific individuals who choose to have more than one loan
outstanding. Brokerage commissions and other expenses relating to
the sale of the Investment Funds for the account of any participant
in connection with a withdrawal or distribution from the Plan are
deducted from the proceeds of the sale.
3. INVESTMENTS
The cost, market value and net asset value per unit/share at
December 31, 1995 and 1994 for the respective Investment Funds (see
Note 4) were as follows:
<TABLE>
<CAPTION>
December 31, 1995
Net Asset
Market Value Per
Cost Value Unit/Share
<S> <C> <C> <C>
Fidelity Equity-Income
Fund, Inc. (85,515 units) $ 2,698,995 $ 3,243,579 $37.93
Fidelity Retirement Growth
Fund (164,279 units) 2,887,368 2,988,236 $18.19
Allen Common Stock Fund
(320,070 shares) 4,788,384 7,161,566 $22.38
Hartford Fixed-Income
Fund 3,236,892 3,236,892 -
TransPro Common Stock
Fund (14,308 shares) 294,272 152,023 10.63
Morley Stable Value
Fund (234,224 units) 2,570,111 2,644,254 11.29
$16,476,022 $19,426,550
</TABLE>
<TABLE>
<CAPTION>
December 31, 1994
Net Asset
Market Value Per
Cost Value Unit/Share
<S> <C> <C> <C>
Fidelity Managed Income
Portfolio (2,102,640 units) $ 2,102,640 $ 2,102,640 $1.00
Fidelity Equity-Income
Fund, Inc. (66,366 units) 2,019,132 2,037,464 $30.70
Fidelity Retirement Growth Fund
(113,982 units) 2,024,951 1,851,069 $16.24
Allen Common Stock Fund
(227,266 shares) 2,600,864 5,425,976 $23.88
Hartford Fixed-Income Fund 4,226,733 4,226,733 -
$12,974,320 $15,643,882
</TABLE>
4. CONTRIBUTIONS
Participation in the Plan is voluntary, and all employees
(full-time and part-time, salaried, hourly and union employees,
only if pursuant to a collective bargaining agreement) of the
Company and its subsidiaries in the United States (other than its
territories and possessions) who were employees on October 1, 1985
or who thereafter have completed six months of employment are
eligible to be participants. In addition, as discussed in Note 1,
any employee who was a participant of the ATG Plan on December 31,
1993 became a participant of the Plan as of January 1, 1994.
Effective May 1, 1994, the Plan was amended to extend the
eligibility participation period from six months to twelve months
for employees of the Company's wholly owned subsidiary MARTA
Technologies, Inc. ("MARTA"). The Plan was amended as of January
1, 1994 so that effective March 1, 1994 a participant may
contribute to the Plan in each month any whole percentage of his or
her compensation he or she selects for such month which is not less
than 1% or more than 17% of his or her compensation for such month.
Prior to this date the maximum allowable contribution percentage
was 12% on a before-tax basis. The Plan was also amended to
entitle participants to make after-tax contributions of not less
than 1% nor more than 12% of his or her compensation. In any
event, a participants' contributions may not, in the aggregate,
exceed 18% of his or her compensation. Compensation includes base
salary, overtime earnings, bonuses (other than bonus payments under
the Company's Key Management Deferred Bonus Plan or any successor
or similar plan) and commissions. In addition, a participants'
individual allowable contributions may be limited by various other
government regulations. Contributions by participants may be made
only through periodic payroll deductions.
In addition to the above, the Plan was amended in 1994 to
provide the Company's Comsearch division ("Comsearch") an annual
profit sharing contribution to each participant who is employed on
the last day of the Plan year an amount equal to 3% of the
participant's Plan year compensation. The profit sharing
contribution is allocated among the investment funds at the
participant's direction. This benefit is in lieu of Comsearch
participating in an employer sponsored defined benefit pension
plan.
Unless the Company increases, decreases or suspends its
monthly contributions in accordance with the terms of the Plan, the
Company makes a monthly contribution for each participant equal to
25% of the first 1%, 25% of the second 1%, and 50% of the third 1%,
of compensation contributed by the participant during such month,
up to a maximum Company contribution of $1,200 per year. As soon
as practicable after the end of each month, the participants' and
the Company's contributions are forwarded to the Trustee for
investment. Company contributions to the Allen Common Stock Fund
relating to the Company match included in the statements of income
and changes in plan equity were $373,917, $312,262 and $185,711 for
the years ended December 31, 1995, 1994 and 1993, respectively. In
addition, the profit-sharing contribution, noted above, included in
the statement of income and changes in plan equity for the years
ended December 31, 1995 and 1994 was $275,852 and $224,233,
respectively.
Participants' contributions to the Plan are invested by the
Trustee, as directed by the participant, in one investment fund or
divided among two or more funds, with such funds (the "Investment
Funds") comprised of the following:
<TABLE>
<CAPTION>
Number of
Participants
as of
December 31,
1995 1994
<S> <C> <C>
(i) Fidelity Managed Income Portfolio: is
intended to be a more conservative
Investment Fund; invests in a portfolio
of investment contracts issued by
insurance companies, banks, or other
financial institutions; - 693
(ii) Fidelity Equity-Income Fund: seeks
reasonable income by investing primarily
in income-producing equity securities; 755 595
(iii) Fidelity Retirement Growth Fund: seeks
capital appreciation by investing primarily
in the common stock of companies operating
in the United States and/or abroad, although
bonds and preferred stock may also be
purchased by the Fund; 744 541
(iv) Allen Common Stock Fund: consists solely
of shares of common stock (par value $1.00
per share) of the Company; 1,309 1,115
(v) Hartford Fixed-Income Fund: intended to
provide a predictable rate of return;
Hartford guarantees contributions against
financial loss; 397 434
(vi) Morley Stable Value Fund: is intended to
remain stable regardless of stock and bond
market fluctuations; invests in a portfolio
of investment contracts issued by insurance
companies, banks and corporations; synthetic
or alternative investment contracts,
collective investment pools and money market
instruments; 749 -
(vii) TransPro, Inc. Common Stock Fund: consists
solely of shares of common stock of TransPro,
Inc. resulting from the Truck Products Spin-
Off (see Note 8). 265 -
</TABLE>
The total number of participants in the Plan is less than the
sum of participants shown above due to participation in multiple
Investment Funds by participants.
A participant may change Investment Funds as to any future
participant contributions through use of a toll free telephone
number at any time. Such change will be effective as soon as
practicable after the Plan is notified. A participant may transfer
all or part of the value of his existing Participant Contribution
Account (Note 5) between Investment Funds once per month through
use of a toll free telephone number which transfer will be
effective as soon as practicable after notification by the sale of
part or all of the Investment Fund or Funds out of which the
participant is transferring and the investment of the cash proceeds
of such sale in the Investment Fund or Funds to which the
participant is transferring. However, the Hartford and Managed
Income Funds have certain restrictions on direct transfers between
Funds. The brokerage fees, if any, of such sales and investments
are paid by the individual participant making the transfer. The
Committee may at any time or from time to time, in its sole
discretion, add or delete funds in which participant contributions
may be invested.
Participant contributions to the Plan are invested by the
Trustee in the Investment Funds as directed by participants, and
Company contributions to the Plan (with the exception of the
profit-sharing contribution noted previously) are invested by the
Trustee exclusively in the Allen Common Stock Fund, with the
exception that, to avoid the retention of idle funds, such
participant and Company contributions may be invested in cash
equivalent securities for periods generally not exceeding 30 days
prior to investment in the Allen Common Stock Fund or the other
Investment Funds. While such contributions are invested in cash
equivalent securities, interest is generally accrued until the
contributions are allocated to the respective Investment Funds.
Participants' before-tax contributions to the Allen Common
Stock Fund and Company matching contributions are used by the
Trustee to purchase treasury shares provided by the Company at a
price which is 15% below prevailing market price at the time of
purchase. During 1995, 1994 and 1993, the Trustee purchased from
the Company 61,781, 54,504 and 108,880 shares, respectively, of
common stock for the accounts of participants in the Plan. In
addition, at December 31, 1995, the Company had authorized and made
available for purchase by the Plan shares of its common stock held
in treasury shares at 15% below prevailing market prices. The
Trustee purchases shares of the Company's common stock for
transactions other than purchases for before-tax contributions and
Company matching contributions in open market transactions. In
addition, the Trustee purchases shares or other units of the other
Investment Funds (as directed by the participants) on a national
securities exchange at market prices current at the time of
purchase or in such other manner as the Trustee, in the sole
discretion, may determine. The Company has no control over the
times or prices at which the Trustee makes such purchases and
investments or the amounts thereof, and the number of shares or
units purchased depends on the prices paid by the trustee.
5. VESTING AND WITHDRAWALS
Pursuant to the Plan, investments acquired with the
participant's contributions are segregated in the Participant
Contribution Account, and investments acquired with the Company's
contributions are segregated in the Employer Contribution Account.
Cash dividends, interest and investment earnings paid on the
investments in each of the participant's accounts are automatically
reinvested in the respective Investment Funds to which they relate.
Each participant's interest in his or her Participant Contribution
Account and the Company match portion of the Employer Contribution
Account is always fully vested. The aforementioned Comsearch
profit-sharing contributions vest in equal amounts over the period
of three to seven years of credited service. Except for permitted
withdrawals and hardship distributions, the participant's
investments are distributable only when employment terminates. A
participant, or the beneficiary of a deceased participant, is
entitled to receive the aggregate value of the participant's shares
and units held under the Plan if employment is terminated for any
reason, including death, disability or retirement.
While employed by the Company or a subsidiary, a participant
may withdraw all or any part of his or her before-tax Participant
Contribution Account and his or her Employer Contribution Account
only in cases of financial hardship or after attaining age 59-1/2.
After-tax contributions may be withdrawn from the Plan once a year
in an amount no less than $250. In cases of financial hardship
where a participant requires funds to meet an immediate, heavy
financial need and has no other resources reasonably available to
meet that need, he or she may request the Committee to authorize a
withdrawal by him or her from his or her Participant Contribution
Account and Employer Contribution Account. The Committee relies on
Internal Revenue Service ("IRS") guidelines to determine if
financial hardship exists and to determine the amount, if any, of
the withdrawal to be made by the participant. In addition, after
attaining 59-1/2, a participant may withdraw all or a portion of
his or her Participant and Employer Contribution accounts for any
reason without penalty.
Any amounts not vested and not eligible for withdrawal at
termination of a participant's employment are available to the Plan
to pay administrative costs and reduce Company contributions.
Shares or units withdrawn and distributed in 1995, 1994 and
1993 by participants from the respective Investments Funds were as
follows (former ATG Plan funds include shares transferred to the
Allen Plan funds in 1994):
<TABLE>
<CAPTION>
1995 1994 1993
<S> <C> <C> <C>
Fidelity Managed Income Portfolio 333,690 314,915 627,759
Fidelity Equity-Income Fund 8,097 5,682 42,808
Fidelity Retirement Growth Fund 13,049 6,983 124,672
Allen Common Stock Fund 19,526 25,396 80,303
Hartford Fixed-Income Fund ($) 253,100 599,495 -
TransPro Common Stock Fund 3,348 - -
Twentieth Century Select Fund - 29,646 -
Twentieth Century Ultra Fund - 53,731 -
Vanguard Fixed Fund - 101,714 -
Morley Stable Value Fund 245 - -
</TABLE>
Benefit obligations for persons who have withdrawn from
participation in the Plan (with the exception of participants
affected by the Spin-off discussed in Note 8) but are unpaid as of
year-end are as follows at December 31, 1995 and 1994:
<TABLE>
<CAPTION>
1995 1994
<S> <C> <C>
Fidelity Managed Income Portfolio $ - $ 57,922
Fidelity Equity-Income Fund 40,211 40,155
Fidelity Retirement Growth Fund 18,164 11,556
Allen Common Stock Fund 65,223 35,341
Hartford Fixed-Income Fund 36,762 141,393
Morley Stable Value Fund 29,601 -
$189,961 $286,367
</TABLE>
6. PARTICIPANT LOAN ACCOUNT
The Plan permits participants to borrow up to 50% of the value
of his/her Investment Funds including employer contributions. As
more fully described in the "Loan Rules" of the Plan, participants
must meet certain minimum qualifications to obtain a loan, and
loans must be for a minimum of $500 and cannot exceed $50,000. The
term of the loan can be for any period of time up to 60 months as
selected by the participant; such loans bear interest at the prime
rate charged by the Company's principal lending banks plus 1% at
the time the loan is made and will carry such interest rate
throughout their terms. Monthly principal and interest repayments
(done automatically through payroll deductions) are credited to the
participant's own account and are reinvested in the Investment
Funds in the same manner as the participant's contributions are
invested. A participant may have up to three loans outstanding at
any one time.
If a loan is declared in default (as defined in the "Loan
Rules" of the Plan), the entire outstanding principal balance will
become immediately due and payable, and if not immediately paid the
loan will be canceled and the outstanding balance will be treated
as a distribution or withdrawal from the Plan depending upon the
participant's tax circumstances. The Plan Committee, in its sole
discretion, may take such action it considers appropriate to
collect the unpaid principal and the accrued interest on a
defaulted loan. Funds for a loan will be obtained from the net
proceeds, after the payment of brokerage commissions, of the sale
of a sufficient number of units or shares in the participant's
Investment Fund account.
7. FEDERAL INCOME TAXES
The Company received a determination from the IRS on August
15, 1995 that the Plan is a qualified plan under Section 401(a) and
401(k) of the Internal Revenue Code. Accordingly, the Plan has not
been subject to federal income taxes, and employer and participant
contributions and earnings of the Plan have not been subject to
U.S. income taxes until distributed to the participants. Early
withdrawals or distributions may subject the participant to certain
tax penalties.
The Plan was amended subsequent to receiving the most recent
IRS determination letter; however, the Plan Committee does not
believe such amendments affect the Plan's tax status.
8. SPIN-OFF OF TRUCK PRODUCTS BUSINESS
On September 8, 1995, the Company's Board of Directors
declared a spin-off distribution of 100% of the common shares of a
newly formed wholly owned subsidiary, TransPro, Inc. ("TransPro")
to the Company's common shareholders of record at the close of
business on September 29, 1995 (the "Spin-off"). Common shares
were distributed on the basis of one share of TransPro Common stock
for every four shares of the Company's common stock. Prior to the
Spin-Off, the Company contributed to TransPro cash, the ownership
interests in the net assets and liabilities of its Crown and G&O
Manufacturing Company divisions and the stock of AHTP II, Inc. and
Allen Heat Transfer Products, Inc., which owned the Company's
partnership joint venture interest in GO/DAN Industries ("GDI").
These entities comprised the Company's Truck Products Business (the
"Business"). Following the distribution, TransPro became an
independent, publicly traded corporation.
As a result, the Plan was amended such that shares of TransPro
issued as a dividend on Allen common stock pursuant to the Spin-off
were held in a separate account and were then subject to the
subsequent investment direction by Participants prior to December
20, 1995. Any shares of TransPro held in the account of a
Participant, other than a Participant transferred to TransPro, on
December 20, 1995 were reinvested in Allen common stock.
In addition, the Plan was amended such that any Participant
who was a transferred employee as a result of the Spin-off, ceased
to be a Plan Participant upon transfer of the related Plan assets
to the successor Plan implemented by TransPro. The net assets and
liabilities of approximately $1,623,000 (including 14,165 shares of
TransPro common stock) were transferred in 1996. Accordingly, this
amount will be included in withdrawals and distributions in the
1996 statement of income and changes in Plan equity.
9. SALE OF DIVISION
Effective June 10, 1993, the Company sold to SPX Corporation
the net assets of its automotive diagnostic test equipment business
comprised of the Company's Allen Testproducts division (U.S. and
Canada); Allen Group Electronics Puerto Rico Inc.; The Allen Group
Leasing Corporation; and The Allen Testproducts division and
related leasing operations of The Allen Group Canada Limited. In
connection with this sale, the Plan assets and corresponding future
liabilities relating to employees of the above mentioned entities
were transferred to the purchaser in 1993. This transfer of funds
has been included in the statement of income and changes in plan
equity for 1993 as "withdrawals and distributions" and amounted to
approximately $3,136,000. In addition, there was a subsequent
reduction to the Participant Loan Account to adjust for loans
transferred to SPX Corporation. This adjustment has been included
in the statement of income and changes in plan equity for 1995 as
"withdrawals and distributions" and amounted to approximately
$175,000.
EXHIBIT 99 (a)
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
ANNUAL REPORT
PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
(Mark One):
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED].
For the fiscal year ended December 31, 1995
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED].
For the transition period from ______ to ______
Commission file number 1-6016
A. Full title of the plan and the address of the plan, if
different from that of the issuer named below:
THE ALLEN GROUP INC. EMPLOYEE STOCK SAVINGS PLAN
(the "Plan")
B. Name of issuer of the securities held pursuant to the
Plan and the address of its principal executive office:
THE ALLEN GROUP INC. (the "Company")
25101 Chagrin Boulevard
Beachwood, Ohio 44122<PAGE>
THE ALLEN GROUP INC.
EMPLOYEE STOCK SAVINGS PLAN
FORM 11-K
(For the fiscal year ended December 31, 1995)
Table of Contents
Financial Statements
(i) Report of Independent Accountants 3
(ii) Statements of Financial Condition -
December 31, 1995 and 1994 4
(iii) Statements of Income and Changes
in Plan Equity for the years
ended December 31, 1995, 1994
and 1993 5
(iv) Notes to Financial Statements 6 - 8
Schedules are omitted because they are not required or
not applicable or because the information is furnished
elsewhere in the financial statements or the notes
thereto.
REPORT OF INDEPENDENT ACCOUNTANTS
To the Employee Stock Savings Plan Committee
and the Participants in The Allen Group Inc.
Employee Stock Savings Plan:
We have audited the accompanying statements of financial condition
of THE ALLEN GROUP INC. EMPLOYEE STOCK SAVINGS PLAN as of December
31, 1995 and 1994, and the related statements of income and changes
in plan equity for each of the three years in the period ended
December 31, 1995. These financial statements are the responsi-
bility of the Plan's management. Our responsibility is to express
an opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the
amounts and disclosures in the financial statements. An audit also
includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial condition of THE
ALLEN GROUP INC. EMPLOYEE STOCK SAVINGS PLAN as of December 31,
1995 and 1994 and the results of its operations and changes in plan
equity for each of the three years in the period ended December 31,
1995 in conformity with generally accepted accounting principles.
As further discussed in Note 1 to the financial statements, the
Plan was terminated in June, 1992 and the distribution of the
related assets to participants was completed in December, 1995. In
accordance with generally accepted accounting principles, the Plan
has prepared its 1995, 1994 and 1993 financial statements using the
liquidation basis of accounting.
As described in Note 2 to the financial statements, in 1993 the
Plan modified its accounting for amounts owed to withdrawing
participants based upon recently issued professional guidance.
COOPERS & LYBRAND, L.L.P.
Cleveland, Ohio
April 25, 1996
<TABLE>
THE ALLEN GROUP INC. EMPLOYEE STOCK SAVINGS PLAN
STATEMENTS OF FINANCIAL CONDITION
December 31, 1995 AND 1994
<CAPTION>
1995 1994
<S> <C> <C>
Assets:
Investment in common stock of
The Allen Group Inc. at market
value - 2,467 shares in 1994, (Note 2) $ - $ 58,900
Accrued interest and dividends
receivable (Note 2) - 186
Cash and equivalents - 3,353
- 62,439
Liabilities:
Accrued administrative expenses - 1,049
- 1,049
Plan equity $ - $ 61,390
The Notes are an integral part of these statements.
</TABLE>
<TABLE>
THE ALLEN GROUP INC. EMPLOYEE STOCK SAVINGS PLAN
STATEMENTS OF INCOME AND CHANGES IN PLAN EQUITY
FOR THE YEARS ENDED December 31, 1995, 1994 AND 1993
<CAPTION>
1995 1994 1993
<S> <C> <C> <C>
Investment income:
Interest $ 190 $ 219 $ 5,157
Dividends 873 1,471 16,779
Net appreciation/adjustments
in the fair value of
investments (Note 1) 3,622 10,177 115,073
Net increase in plan equity 4,685 11,867 137,009
Less withdrawals, distribu-
tions and forfeitures -
1995, 2,753 shares;
1994, 8,340 shares; and
1993, 155,941 shares; (66,075) (114,328) (3,226,118)
Cumulative change in
accounting principle
(Note 2) - - 34,075
Change in plan equity for
the year (61,390) (102,461) (3,055,104)
Plan equity, beginning of
year 61,390 163,851 3,218,955
Plan equity, end of year
(Note 1) $ - $ 61,390 $ 163,851
The Notes are an integral part of these statements.
</TABLE>
THE ALLEN GROUP INC. EMPLOYEE STOCK SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
1. PLAN TERMINATION
The Company terminated The Allen Group Inc. Employee Stock
Savings Plan ("the Plan") effective June 30, 1992 and completed
the final distribution to participants in December 1995. Prior
to liquidation, participants were granted the option of
receiving their respective portion of the Plan's assets in a
lump sum distribution, in cash or in shares, in an annuity or as
a rollover into the Company's Employee Before-Tax Savings Plan.
Such requests were handled accordingly and included tax
considerations for withholding and penalties, depending on the
distribution option selected.
The Company devised a format to distribute the Plan's remaining
forfeiture shares to the participants. Eligibility for
receiving these shares was based on participation in the Plan as
of March 31, 1993. In connection with this distribution, the
Company developed a graduated scale so that each participant was
guaranteed at least one forfeiture share. This format allocated
a disproportionately larger benefit to the small shareholders
rather than bias the distribution in favor of highly compensated
employees who generally held a larger number of shares.
At December 31, 1993, the majority of the Plan's assets were
distributed. During 1994, a small distribution took place, and
in 1995, the final distribution of the Plan's assets was
completed. Accordingly, these financial statements represent
the final statements for this Plan and were prepared on the
liquidation basis of accounting.
2. SUMMARY OF ACCOUNTING POLICIES
The Plan invested exclusively in shares of common stock of the
Company, with the exception that, to avoid the retention of idle
funds, investments were made in cash equivalent securities for
periods generally not exceeding 30 days prior to investment in
such shares. The investment in such common stock was stated at
market value based upon the last sale price of the Company's
common stock on the New York Stock Exchange Composite Tape on
the last business day of the year. At December 31, 1994, the
market value of such investments exceeded cost by $57,588; the
related cost of these investments was $1,312.
The Plan's statements of income and changes in plan equity
include the net appreciation (depreciation) in the fair value of
its investments, which consisted of the realized gains or losses
and the unrealized appreciation (depreciation) on those
investments.
The Plan used the accrual method for recognizing contributions,
withdrawals and investment income. Dividends were accrued on
the ex-dividend date. Withdrawals, distributions and
forfeitures were valued on a liquidation basis for distributions
made in 1995, 1994 and 1993. The Company's Trustee purchased
and disposed of shares of the Company's common stock on the New
York Stock Exchange (the "Exchange") at current market prices or
in any other manner that the Trustee deemed appropriate,
including purchases from the Company. The Company had no
control over the times or prices at which the Trustee made such
transactions or the amounts thereof, and the number of shares
purchased depended on the price paid by the Trustee.
Based upon the Accounting and Auditing Guide (with conforming
changes as of May 31, 1993), "Audits of Employee Benefit Plans,"
issued by the American Institute of Certified Public
Accountants, the Plan did not account for amounts owed to
withdrawing but unpaid former participants and participant loans
in process as Plan liabilities. Amounts allocated to the
accounts of such former participants totaled $34,075 as of
December 31, 1992 and were reflected as a cumulative change in
accounting principle in the statement of income and changes in
plan equity for the year ended December 31, 1993.
All expenses of administering the Plan, including the Trustee's
fees and brokerage commissions on stock purchases, were paid by
the Plan. Brokerage commissions and other expenses incurred in
the sale of shares for the account of any participant were
deducted from the proceeds of the sale.
Participation in the Plan was voluntary prior to June 30, 1992,
and all employees (full-time and part-time, salaried, hourly,
foreign and domestic) of the Company and its subsidiaries were
eligible to be participants. Due to the termination of the
Plan, participant contributions ceased at June 30, 1992. In
accordance with the terms of the Plan, the Company has not
made monthly contributions since February 1, 1988.
3. VESTING, WITHDRAWALS AND FORFEITURES
The option to withdraw, with certain limitations, all or any
part of the shares in a Participant's Account including all or
any part of the vested shares in his or her Employer Account,
was available to all participants through April, 1993. Prior to
this period, however, distributions and permitted withdrawals
were made in shares of the Company's common stock or from the
net cash proceeds realized from the sale by the Trustee of the
distributed or withdrawn shares, as the participant or his or
her beneficiary elected. A participant who made such a
withdrawal was subject to suspension from participation and
could have forfeited some or all of the unvested shares
purchased with the Company's contributions. In cases of
financial hardship, as determined by the Committee which
administered the Plan, a participant could withdraw shares
within certain limits without such penalties. All unvested
shares remaining in the Employer Account after a distribution or
total withdrawal, other than a qualified hardship withdrawal,
were transferred to the Forfeiture Fund maintained by the
Trustee. After April 1993, the Company froze the assets in the
Forfeiture Fund so that the Company could allocate and
distribute such assets to the participants. (See Note 1.)
4. FEDERAL INCOME TAXES
The Company received a favorable determination from the Internal
Revenue Service that the Plan, as amended for termination
effective June 30, 1992, was a qualified plan under Section
401(a) of the Internal Revenue Code. Accordingly, the Plan was
not subject to federal income taxes, and employer contributions
and earnings of the Plan were not subject to U.S. income taxes
until distributed to the participants. However, depending on
the distribution option selected by the participant at
liquidation, the participant may be subject to tax penalties.
